The Bear Market Still Growling?

Not!

See charts below...

[Click on charts to enlarge]

Oh sure, the stock in the chart above got slammed by the bear market's ferocious end (September/October 2008), but it has since risen back to its prices prior to the decline, and then some. Wow!

I identify many items in the chart above, up-to-date through today's close of business. Yes, it is a symmetrical triangle; better (more bullish) than that, though, is the internal ascending triangle now building. Note trend line 1, and especially points a and b, which show the breakout and successful test of that breakout. And today, the stock breaks above trend line 3, at point c -- with 180% of average daily volume.

Look at the chart below, which is the same stock and carries over the trend lines from the chart above, but its basis is weekly rather than daily: the set up and pattern look bullish to my eyes...

So where is the bear market...? The charts above -- and many, many more -- betray an increasingly bullish picture.

Comments

[enigmaman:]

Great charts, but really you just have to have a look in the mirror at yourself to take the temperature of the economy and the market, check your bank account, look at your home equity value, your job security, your spending habits etc multiple that by 300 million other consumers and plot each on a chart, it doesnt get more real then that backed up by the recent astounding consumer cut back on debt iprovides the best indicator of what the future has in store for America

Sep 09 08:21 AM

[titopoli:]

Looks like the stock market is uncoupled from the economy's numbers. That was also the case ten years ago: no earnings in tech-land but stocks were up up and away.

What do we want? Do we want to be right on the economy or do we want to make money in the market. Go ahead, David!

Sep 09 09:02 AM

[NUCLEAR1929:]

it never stopped, it just moved from stocks to real economy which is even worse for stocks

Sep 09 09:06 AM

[Nick36:]

The picture can change at any time. And the only way to know which way it will likely change is to look at the economy and at the reported P/E ratios of companies.

Companies will need to increase their earnings a lot to justify their present sky high reported P/E ratios. And whether they will be able to increase their earnings so much still remains to be seen.

The reported P/E of S&P 500 is now 129.19.
www2.standardandpoors....

Which shows just how much the earnings of companies need to increase to justify current stock prices. And when consumers are so in deep trouble as they are now. Then I think it's a little unreasonable to expect the earnings of companies to increase so much.

The current stock market is nothing more than a speculative bubble waiting for something that's unlikely to happen.

Sep 09 10:02 AM

[MichaelAK:]

Let us not forgot were else is one to put the money. This is another Fed bubble going back into stocks which has helped short term to heal some 401-k, pensions and give financial houses a shot in the arm via trading. What happens when the fed increase interest rates to defend the dollar? Were are you going with almost zero % interest rate. Of course stocks but have to admit I got out of this rally to early and did not put enough to work but at these levels not seeing alot of growth in US to justify such high PE's but were are you going to put your money to hope earn a really return which will give you only 2 choices, stocks and commodities at least from a US perspective.

Sep 09 10:10 AM

[Old Trader:]

I have to agree that there seems to be a definite "disconnect" between the market and the economy. Of course, the question remains, will there be a correction if growth disappoints, like many of us think, or will the market "consolidate" via tracking along a relatively flat line for an extended period of time?

Obviously, there's a large difference between the 2 above scenarios, amd that difference makes portfolio positioning pretty tricky. If/when a correction occurs, being short, or at the least overweight cash (by a lot) is the obvious call. If it ends up with a flat line scenario, I'm thinking any gains would come via yield.

Sep 09 08:55 PM

[JeffDB:]

On Sep 09 10:10 AM MichaelAK wrote:

> ... but were are you going to put your money to hope earn a really return which will give you only 2 choices, stocks and commodities at least from a US perspective. >

They may not be for you, but it seems to me as if international bond funds might be one alternative. seekingalpha.com/artic...

The Nuveen Multi-Currency Short-Term Government Income Fund (NYSE: JGT), for instance is currently paying ~ 9% www.etftrends.com/2009...

Sep 10 12:42 AM

[dustbusterz:]

this is all hype , its a bubble that is waiting to burst, and the stocastics show this as it is weakening.,showing an uptrend about to burst.

Oct 04 12:53 AM